Questions raised over SCF payments to Maier and For Barr

By Jenny Ruth

Sunday 12th September 2010 1 Comment

A long time South Canterbury Finance (SCF) supporter is questioning the roles played by chief executive Sandy Maier and stock broker Forsyth Barr and how much they were paid in the lead up to SCF's receivership.

"Facts yet to enter the debate will follow formal answers to some highly important questions which cast doubt on the value to the taxpayer, to Hubbard or to SCF perpetual shareholders on the appointment of Sandy Maier and on the role of Forsyth Barr and, in particular, (Forsyth Barr managing director) Neil Paviour Smith," says financial adviser Chris Lee in his latest email to clients.

Maier, who has led a number of company restructures since being appointed statutory manager of the government-owned Development Finance Corporation between 1990 and 1992, was appointed SCF chief executive on December 29 last year.

Lee is questioning how much Forsyth Barr and Maier were paid for work they did for SCF.

How much Maier was paid hasn't been disclosed but Lee says: "I believe the contract paid him $5,000 per day and that a final additional payment of $1 million was held in a trust for him, whether he succeeded or not in his search for a solution."

Lee also estimates Forsyth Barr was being paid $200,000 a month to advise SCF and its total remuneration from June last year "would be nearer $10 million than $5 million." He also accuses Paviour-Smith of being "a deemed director of SCF and in may ways SCF's puppeteer."

Maier wouldn't say how much he was paid. "I don't discuss things like that," he said last week.

Paviour-Smith says he was never a SCF director and Forsyth Barr wasn't being paid anywhere near the amounts Lee estimates and wasn't being paid $200,000 a month.

While Lee says Forsyth Barr was paid 4%, or $1.1 million, for organising a $27.4 million convertible notes issue last December.

"That's not an accurate way of describing it," Paviour-Smith says. "There was a whole bunch of work we were paid for. Some of it was for capital raising." Forsyth Barr contributed "a lot of assistance over quite a number of months."

Comments from our readers

On 14 September 2010 at 1:04 pm Michael Smyth said:

Nobody could have got Allan Hubbard and South Canterbury more wrong than Chris Lee. He had unadulterated admiration for Allan Hubbard and pumped investors' funds into South Canterbury. I read him now trying to deflect attention away from his complete misjudgement and disastrous analysis of the whole finance company sector on others.